12/07/2009 @ 4:25PM

Joojoo's Obstacle: Price, Not Mike Arrington

Fusion Garage, the company that had been working on TechCrunch boss Mike Arrington’s CrunchPad tablet PC, is moving forward with a device of its own. And Arrington, who canceled plans for the CrunchPad, is plenty mad. The biggest missing piece, however, isn’t the big-name blogger, it’s the original concept’s not-so-big price.

Fusion Garage held a video conference Monday to unveil Joojoo, a device that will have a 12.1-inch touch screen and a 9-second boot time. Fusion Garage will start taking orders for the device on Friday for $499.

That’s a whole lot more than the $200 “dead simple” device Arrington had originally imagined. Of course, a 12.1-inch capacitative screen doesn’t come cheap. Nor do the parts needed to crank out high-definition video on a device weighing just 1.9 kilograms. “There are dreams, and then there are illusions,” Fusion Garage Chief Chandrasekar Rathakrishnan said. “Arrington’s dream of a $200 or even $300 device was just that: an illusion, nothing worth doing can be brought to market at that price.”

There’s no reason not to believe Rathakrishnan on that point. Yet price–not Arrington–could be his biggest challenge. While the Joojoo looks slick, a consumer can grab a netbook computer for $200 less that includes a keyboard and a “real” operating system. To succeed, Rathakrishnan will have to explain to consumers why they should pay more, for less.

That can be done.
Apple
could be the best example. Chief Executive
Steve
Jobs
Steve Jobs
is often criticized for his secrecy. Secrecy, however, helps him focus attention on the value of what he’s got to offer. There was little time for that Monday, however, with Rathakrishnan spending much of his time responding to the complaints of his one-time partner, Arrington. While Arrington is promising to sue, Rathakrishnan asserted that Fusion Garage had no contracts with Arrington or TechCrunch and that Fusion Garage owns all the intellectual property related to the device.